Trade in Services Negotiations

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Marconini and SauvĂŠ

sense of the likely opportunity costs flowing from various approaches to liberalization and policy bindings under service agreements, including the choice not to make new or improved binding commitments, thereby preserving policy space. The heterogeneity and intangible nature of services pose challenges to service negotiators. Governments tend to consider services in a piecemeal, segmented manner that often reflects the particular characteristics of individual sectors rather than the role of services in the economy. This tendency may be seen in the generally disorganized way in which many governments tackle service issues. Few governments have ministries of services, while most, if not all, have numerous sectoral ministries dealing with individual service sectors. These may include financial services through a ministry of finance or a ministry of the economy, telecommunications services through a ministry of communications (which might also cover postal services, broadcasting, and audiovisual services), a ministry of transportation, and so forth. Many service-related issues also involve more than one ministry or government agency. This is the case in regard to the movement of natural persons and the trade in professional services, which, in many countries, is the shared responsibility of ministries of external relations, justice, education, and immigration. Developing a clear strategy for services therefore poses, for most governments, genuine institutional challenges in that no single agency takes a holistic view of services and their interlinked contribution to the development and growth process. Accordingly, any attempt to devise a service sector road map or strategic blueprint must start with the establishment of a cross-sectoral, multi-issue steering committee and the designation of a specific ministry, secretariat, agency, or person within the government to carry out a coordinating function, identify the key elements in a service road map, and oversee implementation. The coordination function is not trivial because it cuts across bureaucratic competencies (regulatory turf) and may create tensions between sectoral and economy-wide perspectives. Considering the economy-wide implications of service sector reform, reform should be coordinated or derive a clear delegation of power from the highest levels of government (for example, the office of the presidency or the prime minister). Sectoral ministries naturally focus on the design and implementation of the policies that are optimal for each sector under their jurisdiction. The establishment of a national development strategy, however, requires that services be thought of in economy-wide terms. Governments should identify growth and development bottlenecks in the


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